Birmingham City Council's claim that Alexander Stadium is to become Britain’s new national centre for athletics backfired when the announcement turned out to be premature.

Cabinet members approved a £12 million expansion plan, taking maximum capacity at the Perry Barr stadium to 25,000.

The scheme would allow the sport’s governing body, UK Athletics, to move its offices from Solihull to Alexander Stadium and allow elite Diamond League meetings with races featuring the world’s top athletes to be staged from 2011, according to cabinet member Martin Mullaney.

He said Birmingham had “beaten London” by securing the national athletics stadium, putting paid to speculation that UK Athletics was poised to move its headquarters to the Olympic stadium in the capital after the 20102 Games.

But the shine was taken off Coun Mullaney’s announcement when UK Athletics confirmed that, although it is considering moving to Alexander Stadium, no decision has been taken.

Before moving the organisation will have to begin formal consultation with about 80 staff at its offices at the Blythe Valley business park close to the M42 in Solihull and talk to its current landlords about exiting a lease.

The financial case for expanding Alexander Stadium rests almost solely on UK Athletics taking up office space under a new 5,000-seat stand with the rental income set to cover repayments on the loan the council has to take out to pay for the project.

Building work will begin by the end of October, Coun Mullaney told the cabinet. But UK Athletics chief executive Niels de Vos said: “The only thing I can confirm is that we have an agreement in principle to take the Diamond League to Birmingham subject to contractual details being ironed out.

“As far as moving our offices is concerned, we have been in negotiations, now we need to take it to the next stage.”

Copies of correspondence released by the council appear to show a slight change of emphasis by UK Athletics during the summer.

On July 5 Mr de Vos wrote to council assistant leisure director Steve Hollingworth stating: “Subject always to contract I can confirm that UK Athletics would like to become an anchor tenant at the facility and that our break clause at our current facility would enable us to relocate from October 2011.”

But two weeks later, Mr de Vos wrote simply to confirm that his organisation would welcome the opportunity to move to Alexander Stadium and would look to hold further detailed negotiations “once the project has become a reality”.

Coun Mullaney (Lib Dem, Moseley & Kings Heath) is confident a deal with UK Athletics will be signed imminently.

He told the cabinet Birmingham could look forward to the possibility of staging the European Athletics Championships and even the Commonwealth Games in future.

He added: “No British city has hosted the European Athletics Championships, but there is a chance now that Birmingham could do so.”

Council leader Mike Whitby said: “This project will further enhance Birmingham’s deserved reputation as Britain’s sporting city, bringing jobs to the city and enhancing our facilities.

“We play host to gold medal hopefuls from the USA and Jamaica ahead of the 2012 Olympic Games and, to build on that success, we need the facilities required for the world’s best athletes to compete here on a regular basis.

“That’s what this project will achieve and we’re again showing Birmingham has the commitment needed to be a significant player in world sport.”